Gold futures up on spot demand; silver trades high

Gold prices on Thursday rose by Rs 155 to Rs 47,155 per 10 gram in the futures trade as speculators created fresh positions on a firm spot demand.

On the Multi Commodity Exchange, gold contracts for the June delivery traded higher by Rs 155, or 0.33 percent, at Rs 47,155 per 10 gram in a business turnover of 10,252 lots.

Fresh positions built up by participants led to the rise in gold prices, analysts said.

Gold prices traded 0.46 percent higher at $1,792.50 per ounce in New York.

Silver prices rose Rs 716 to Rs 70,335 per kg in the futures trade on Thursday as participants widened their bets on a firm spot demand.

On the Multi Commodity Exchange, silver contracts for the July delivery gained Rs 716, or 1.03 percent, to Rs 70,335 per kg in 9,229 lots.

Analysts said the rise in silver prices was mostly due to fresh positions built by participants on a positive domestic trend.

Globally, silver was trading 1.24 percent higher at $26.85 per ounce in New York.

Ravindra Rao, CMT , EPAT, VP-Head Commodity Research, Kotak Securities Ltd said the MCX Gold futures traded in a broad range of 46,600-47,100 as the price moved in a sideways zone. However the bulls have once again pushed the price closer to 47,100 resistance. Price is trading close to the 8 DMA which is still above the 20 DMA indicating a slight bullish bias. Support for the day is pegged at 46,700 and strong support is near 46, 500.Resistance can be seen near 47,100 followed by 47,400. RSI is still below 50(47.30) but might move above 50 today if the bulls push the price above 47,100. Going by the above analysis we expect the price to trade higher provided the bulls penetrate the resistance of 47,100 on a four hour closing basis. In that scenario the profit objective would be till 47,400.Till then we expect a range bound trade of 47,100-4670.

MCX Silver witnessed a good rebound after testing a low near 68,800 ending the day flat near 69,600. A higher 8DMA as against the 20 DMA is supporting the price, Rao said. However, the price is still below the 8 DMA which is limiting the gains. Having said that the 8DMA near 69,900 would act as the resistance for the day. Above that the resistance would be 71,000. Similarly 20 DMA would act as the support which is near 69,200 and below that the next support would be 68,600.RSI is above 50(54) indicating sideways to higher move in today’s session. To conclude we expect silver to trade with a sideways to positive bias until 68,600 holds. A break above 69,900 on a four hour closing might give bulls the required edge to take it close to 71,000, Rao added.

World Silver Survey shows expectations for a rise in total silver demand in 2021 of 15 percent to 1.03 billion ounces, with a 26 percent increase in physical investment to 252.8 million ounces. Last year's net investment in silver-backed ETP grew by 331.1 million ounces, 300 percent surge from previous year, according to Motilal Oswal Investment Securities. It is expected to fall by 55 percent to growth of 150 million ounces this year. silver institute expected silver prices to surge towards $32 per ounce and peak-which is a clear 20 percent upside from current levels, the firm said.

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